Signal Cleveland has read Ohio Gov. Mike DeWine’s stadium slush fund plan so you don’t have to, and even I don’t have to. (Which is appreciated, because the first two sentences of the bill are doozies.) Here’s highlights of what they found:
- Doubling the online sports gambling tax from 20% to 40% would generate an estimated $130-180 million a year, which is a lot, and would easily cover a couple of billion dollars for Cleveland Browns and Cincinnati Bengals stadiums, for starters. Signal Cleveland does not report how that estimated figure was estimated — presumably at some level of increased taxation, people would stop using online sports gambling altogether and the revenue would drop to zero — so we’ll just have to take the governor’s word on this one for now.
- Any resulting windfall of money would be available for either: major-league stadium renovations costing at least $100 million or new stadiums costing at least $1 billion; mixed-use developments around stadiums that are funded at least 60% by non-state sources; or minor-league stadium renovations costing at least $10 million or new stadiums costing at least $50 million. This would cover pretty much anything, though possibly an MLS team might have to appeal to be considered “minor league” if it couldn’t come up with $1 billion worth of crap to stuff into a stadium.
- The newly-created Ohio Advisory Committee for Sports Facility Construction and Youth Sports Education (that’s the OACSFCYSE to you and me) would be required to “prioritize funding facilities or programs that promote economic development, support youth sports education and encourage training in team or individual sports” and “helping communities in the state attract major sporting events or create tax credits to promote youth sports education,” which, yet again, would appear to allow pretty much any pro sports uses.
DeWine, meanwhile, says all this would be great for the state, because it would mean taxpayers wouldn’t have to worry about paying off any nasty bondses:
“We should pay for this with cash,” DeWine said. “We should not bond it with the state.”
That’s … dumb? I’m going to go with dumb. (Collecting even $180 million a year also wouldn’t work to pay off $2 billion in Browns and Bengals costs up front, but maybe DeWine means to pay those off with separate bonds, which, yeah.) As anyone who has taken out a mortgage knows, paying with cash isn’t necessarily better than borrowing the money and paying it off later, especially if you can get a good interest rate — and states have access to significantly lower interest rates than normal humans. Whether borrowing stadium money or paying for a project up front works out better for taxpayers is a financing question, not a public policy question; which is to say that the most efficient way to get a good return on $180 million a year in stadium spending is not to spend $180 million a year on private sports stadiums.
All this still needs to be approved by the Ohio state legislature, where Signal notes “Republican leadership has publicly expressed skepticism,” but there’s still lots of budget haggling yet to go. Hopefully once budget hearings actually start, someone will remember to bring a calculator.
To your 1st bullet point, Illinois increased their gambling tax from 15% to 40% in 2024. So it’s at least possible that they made their estimates in good faith.
Obviously, Illinois also proved that you don’t need to earmark that extra money to new stadiums, so the rest of your post is still spot on.
The Illinois gambling tax hike kicked in on July 1, 2024, which was also the first day of the 2025 fiscal year in Illinois. And the last gambling tax data available is for FY2024, so I think we’re solidly in ¯_(ツ)_/¯ territory here.
https://cgfa.ilga.gov/Upload/2024_wagering_in_il.pdf
Well if they start collecting right away and they could probably collect quite a bit before they have ante up their share.
More the opposite: A stadium contractor would need to be paid right away, while it would take a while for an increased gambling tax to go into effect.
That would depend on when the tax starts and when they break ground. Then you have when the state has to start remitting its portion. So if the state is chipping in the last $1 billion they would have collected quite a but before they start remitting.
I hope the state does create an agency with the (phonetic) name “wack-see-fix-ee”. That would be fabulous. And also strangely accurate.
It is well known (among politicians seeking to funnel public money to their already rich friends, donors and associate felons) that taxes, fees and gambling revenues always increase in linear fashion no matter how high the rates are set and that if they don’t it is totally unforeseeable and not at all their fault even if the general fund has to be raided to paper over any shortfalls (or fail to paper over any shortfalls if the shortfall happens to be, on an annual basis, larger than the entirety of the general fund).
I smell some free luxury box seats for Mikey!!!!
Putting a casino into everyone’s phone was not a good idea, so yes it should get taxed heavily. But this should be funding roads and shit, not welfare for billionaires and their multimillionaire employees.
Haslam also wants the county to kick in another 600MM, which they have said they won’t unless it stays in the city, not in the abandoned industrial site near the airport.
The county imposed a tax hike for a new jail, because the owners of the (polluted) land the jail was to be built on gave 60K to the winning candidate.